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MacAulay favours TPP deal, poised for trade fight with U.S.

Winnipeg | Reuters –– Canada’s new agriculture minister said Tuesday he likely will support the Trans-Pacific Partnership negotiated by the previous government, and is inclined to retaliate against the U.S. over a long-standing meat-labeling dispute.

The Liberal government, elected last month, has not taken a firm position yet on whether it will support TPP, which groups 12 Pacific Rim countries.

“I suspect when I evaluate the whole thing, it will be something I support,” said Lawrence MacAulay, 69, a former potato and dairy farmer from Prince Edward Island.

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“I see nothing today that would make me not want to support the whole package,” he told Reuters in an interview.

MacAulay said a $4.3 billion compensation package offered by the previous government to dairy, poultry and egg farmers who will face more competition looks fair.

Dairy Farmers of Canada spokeswoman Therese Beaulieu said MacAulay assured the group on Monday that TPP would be debated in Parliament before any decisions.

A key U.S. senator said Friday the Obama administration may have to renegotiate parts of the deal to win congressional approval. The administration said Tuesday that was not an option.

MacAulay said Ottawa is prepared to retaliate against the U.S. over the meat-labeling spat, although he conceded Canada’s International Trade Minister Chrystia Freeland is in charge of that file.

Canada and Mexico won a World Trade Organization ruling in 2012 that said U.S. country-of-origin labelling (COOL) regulations illegally discriminated against imported meat.

“You cannot have a deal with foreign countries and not have them comply with the rules,” MacAulay said. “You have to take measures. Do we want to? No. But if we have to, I suspect we will.”

But MacAulay spoke on Monday with U.S. Agriculture Secretary Tom Vilsack and is hopeful Washington will comply with the WTO’s ruling. The U.S. Department of Agriculture said it is up to Congress to comply.

A WTO panel is expected to decide on an authorized retaliation amount this year. Canada has requested authorization for tariffs worth $3.1 billion annually.

“We’d really like to get this issue resolved because when you have an irritant, it detracts from the overall relationship,” said John Masswohl, an official with the Canadian Cattlemen’s Association.

Under the previous government, Canada identified U.S. beef, pork, wine, and other products as possible targets. MacAulay said the new government has yet to decide on targets.

Rod Nickel is a Reuters correspondent covering the agriculture and mining sectors from Winnipeg. Additional reporting for Reuters by Tom Polansek in Chicago.

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